Thousands go at IBM

IBM plans to implement a series of restructuring actions designed to improve its efficiency.

The result of the actions will mean that anywhere between 10,000 and 13,000 employees will be laid off either voluntarily or involuntarily worldwide. The majority of the workforce reductions, however, are planned for Europe.

The company means to reduce its ‘bureaucracy and infrastructure’ and create teams that can work across country borders, shifting more employees into direct client roles. This will eliminate the need for a traditional pan-European management layer to coordinate the activity.

IBM says that the move will allow it to shift resources to higher-growth markets and opportunities such as ‘Business Performance Transformation Services’.

As a result, IBM estimates that it will record a pre-tax charge of between $1.3 billion and $1.7 billion in the second quarter. The company expects to realise benefits starting in the second half of the year.

Last year, IBM disclosed that it was to sell its personal computer business to the Chinese group Lenovo, in a deal worth $1.75 billion. That deal was closed on May 1 this year.